From The Blog

There are a host of technical terms and acronyms invading the world of advertising and media. One you may be hearing more frequently is “SDK.” SDK stands for a Software Development Kit, and one reason why people are talking about it is because it’s playing an increasingly critical role in publishers’ efforts to monetize mobile in-app inventory. A well-implemented SDK can boost the value of mobile app inventory and create a much more dynamic in-app ad experience.

To help shed some light on this topic we have compiled a plain language cheat sheet that explains what SDKs are and what they do.

What is an SDK?
An SDK (Software Development Kit) is a set of software development tools that helps developers to build apps for a specific software platform, like iOS or Android. An SDK may contain APIs (Application Programming Interfaces), technical documentation, sample code, and other tools that help a developer to complete her work.

How are SDKs different from APIs?
Another term that is used a lot in the mobile advertising world is API, which stands for Application Programming Interface. The API is not a kit, it’s simply a clear set of rules, or protocols, for interacting with a system. As long as a programmer knows how to use the right protocols they can successfully accomplish the tasks they want to complete on the platform. An API is like a recipe, it’s a set of clear instructions. Companies often use APIs to give external parties access to their data or systems. An SDK is more like a box of cake mix. It has everything you’ll need to make a cake quickly and easily.

How are SDKs used in mobile advertising?
A publisher can use an SDK to serve ads in an app on an Apple or Android device. Many apps do not have browser-like capabilities. Therefore, SDKs are used for in-app advertising to render the different types of ads such as rich media and native.

Does PubMatic offer Publishers an SDK?
Yes, PubMatic offers SDKs for publishers working on a variety of platforms, including Android, iOS, Windows, and more. The PubMatic SDKs allow publishers to serve more valuable ad impressions in their apps. This is because the SDK can help the app to gather critical data, like location or device type, which can boost the value of mobile ad inventory. PubMatic research uncovered the value of this data to mobile impressions. Once the publisher implements the PubMatic SDK they can serve all ad formats within an app such as display, rich media, video, and native. Our SDKs can even enable an in-app ad to change from profile to landscape, in response to how a user is holding and viewing the mobile device screen.

Since the early days of programmatic, publishers have been worried that the move to real-time auctions in ad sales would inevitably put downward pressure on the value of their advertising inventory. Some voices in the industry even warned that real-time sales would foster an inevitable “race to the bottom” for CPM rates. Part of the reasoning for this line of thinking is that publishers would be forced to make packaging and pricing decisions with minimal insights into the true value of their inventory. The fear was publishers would be forced to do the equivalent of holding a wet finger in the air to read the current market, and then hope for the best.

In a real-time bidding environment, each impression is valued based on various factors such as user age, geography, browsing history, operating system, content parameters, and more. As a result, buyers evaluate this data and place higher bids on inventory that they consider most likely to help them achieve their marketing goals. In this new paradigm, CPM rates can increase, if publishers are leveraging the right real-time insights about the value of their inventory.

Here are three ways publishers can use real-time and competitive insights to return value to the rate card:

Optimize Pricing & Packaging in Real Time

By using a programmatic platform that offers real-time analytics, publishers can derive insights that enable them to constantly assess their own performance. In a real-time world, publishers need actionable real-time data that allows them to make smarter business decisions if they wish to maximize the value of their inventory. Many publishers have been challenged by analytics solutions that provide stale data, making it difficult to execute nimble and smarter packaging strategies.

Compare Performance

Publishers should also consider using analytics that offers them competitive benchmarking insights into the broader overall market. Many publishers’ performance is hindered by a lack of competitive insights. Indeed, just 25% of media analytics professionals report being very satisfied with their analytics solutions. Publishers that have access to benchmarking insights can compare how various ad sizes and formats are performing against competitive peer publishers. Combined with real-time analytics, this benchmarking allows publishers to assess if changes are needed to its packaging strategies across different ad sizes, and ad formats such as display, mobile, and video.

Discover New Advertisers

Another critical way publishers can increase programmatic demand for their inventory is by using benchmarking insights to find buyers that are advertising on competitor sites, but not on their sites. This critical data can help publishers discover new advertising partners and therefore increase their overall demand. It’s one of the most powerful ways that publishers can use the data promise of programmatic to their advantage.

PubMatic is the leader in publisher analytics including the industry’s only solution that offers publishers real-time analytics and competitive benchmarking. To learn more about PubMatic’s analytics solutions for Publishers click here.

As publishers increasingly migrate inventory sales to programmatic channels, technology providers have emerged to provide publishers with the tools to realize the full potential of their digital assets. One such company is our valued partner, PubMatic, which provides publishers with marketing automation software that enables them to manage their programmatic advertising sales.

As buyers are shifting marketing dollars into the programmatic space, publishers need to consider what makes their inventory desirable for their advertising counterparts on the buy side. In the new programmatic landscape, powered by supply side platforms (SSPs), exchanges, and demand side platforms (DSPs), marketers are employing automated media buying and selling tools to ensure that every impression is aligned with their unique campaign message and goals. Every advertising dollar should be spent trying to promote the right message, to the right audience, in the right context. As these three variables align, consumers are more likely to interact and respond to an advertiser’s message, making the impression a more “desirable” purchase for a programmatic campaign manager.

To determine if a publisher is valuable to a marketer, the first question asked is “can I access my target audience?” Increasingly in the programmatic space, marketers have the tools to answer this question. By leveraging 1st party marketer data, 2nd party publisher data, and 3rd party vendor data, marketers can filter publisher inventory, and purchase the specific impressions that make the most strategic sense with a unique desired audience. By forecasting and proactively filtering supply, marketers can determine which publishers offer the greatest reach against their target segments.

After determining audience penetration, the next concern marketers have is whether the site is conducive to driving engagement with the advertisements. Two key questions buyers ask are “will the consumer see my ad?” and “will the consumer be in the right mindset to complete the desired action?”

This means that marketers must evaluate the contextual environment and ad placement on publisher sites. In addition to aligning the page content with the call to action, buyers look for sites with low ad counts per page and highly-viewable placements.

Marketers who buy media programmatically have a distinct advantage over those who rely only on direct buys. Programmatic buyers can measure performance and continually optimize their investment and approach during the life of a campaign. After the message, audience, contextual environment, and viewability settings have been applied, marketers can measure the impact of these choices. Many publishers have relied on click through rate (CTR) to define digital media performance.

However, industry studies reveal that very few users (8%) actually contribute to the majority of clicks (85%), so by optimizing towards clicks, campaigns potentially ignore a brand’s core audience. As marketers learn more about consumer behavior, and programmatic reporting capabilities become increasingly advanced, it is critically important that publishers consider the performance of advertising beyond the click. Engagement metrics that are more indicative of success include: brand survey responses to measure ad engagement; time on brand site or number of pages viewed to measure site engagement; and actions like downloads, registrations, and email or newsletter signups to measure brand engagement. When measuring return on investment using these more indicative KPIs, the influence of audience, contextual, and publisher targeting becomes more apparent.

Marketers are relying on increased levels of transparency and control to drive their desired outcomes. MediaMath, in partnership with PubMatic, works to give advertisers the tools to make smarter decisions. Marketing platforms, like TerminalOne offer robust targeting and reporting options to help marketers validate their approach and refine strategies over time. Knowledge of the variables (i.e. creative, placement, user location, day-part, etc.) driving the best performance gives campaign managers the data to choose the publishers that best achieve their goals. Publishers that engage with advertisers to facilitate transparency and control will be the preferred media partners for communicating brand messages.

During the last few years, the proliferation of screens and ad formats has added more complexity to the business of advertising sales than anyone could have envisioned. More than half of all visitors to U.S.-based news sites come from mobile devices. The consumption of video content is exploding on all devices. Advertisers are shifting budgets towards native ads because of their effectiveness at driving consumer engagement. All of these market trends and shifts are happening at the same time that the ad sales market is being automated and brought up to the speed of real-time by programmatic technology.

Many publishers are trying to juggle all of these changes. There’s a seemingly endless stream of point solutions designed to help publishers solve this new world one piece at a time. These individual solutions may offer solutions for managing video inventory, mobile inventory or native inventory but they don’t help publishers grasp the entire picture.

Imagine a stock trader that relied on one piece of software for trading tech company stocks and another for trading financial stocks and yet another for energy company stocks. The ability to manage a stock portfolio holistically would be significantly compromised by these separate views into the market. And it’s hard to imagine that this arrangement wouldn’t compromise overall performance. Yet it can be argued that some publishers are trying to manage their business in a similar way as they attempt to adapt to a quickly changing media landscape.

Managing several technology solutions creates new challenges for publishers that are already struggling to keep ahead of a quickly evolving market. With each new solution comes additional complexity. That complexity involves identifying actual and potential points of failure. It also includes a myriad of integration challenges associated with operating multiple solutions.

With each new point solution that a publisher adopts, there comes a new user interface as well as new reporting and analytics. Managing all of these vendors and partners becomes a full-time job for an operations department. And every hour that is spent on managing the complexity of multiple solutions is an hour not spent on developing strategies to use the technology to drive revenue.

The reality that most publishers face is that even as the media landscape is spliced up into different screens and formats they still need a simple way to manage their business holistically. The best way to do this is to limit the complexity within their organization. Deciding to use one platform to manage programmatic advertising inventory is perhaps the quickest and simplest way publishers can limit that complexity.

And evolved publishers are now recognizing this. From New York to Berlin to Tokyo, over the last 24 months, views have shifted. If asked two years ago: “Do you want multiple best-of-breed, point solutions or a single-platform for all of your requirements”, probably no more than half of publishers would have chosen the latter. Today, our experience tells us that it’s more than three-quarters and rising as publishers look to escape vendor fatigue.

This in turn creates yet more impetus to partner with publisher specific solutions, such as those offered by PubMatic. Exchanges or vendors offering buy- and sell-side solutions do not have the necessary focus to serve all of a publisher’s requirements across multiple platforms, formats and solutions in the way that a company focused on Marketing Automation for Publishers can.

Publishers are making technology decisions for the next five plus years and not in the same way that they would swap out a network or allocate inventory to an exchange. These are strategic technology decisions that require sophisticated, publisher-centric technology solutions that decrease complexity and accelerate their advertising sales revenue.

Hispanic consumers are heavy mobile users. Indeed, U.S. Hispanics’ use of mobile devices is higher than that of the general population, according to eMarketer. U.S. Hispanics spend 42 percent more on mobile devices and 35 percent more on data services than the general market, according to research by the Alcance Media Group.

Recently, PubMatic President Kirk McDonald sat down with Alberto Pardo, the CEO and Founder of AdMovil, the leading mobile advertising solutions company in the U.S. Hispanic and Latin America market, to discuss how his company approaches reaching the mobile Hispanic consumer.

As programmatic advertising continues to grow globally, its growth in many markets is partially fueled by the rise of private marketplaces. In its early years, the word “programmatic” solely meant the buying and selling of advertising inventory in a real-time open auction. Recently, however, we have witnessed the rise of invitation-only programmatic marketplaces called private marketplaces. These private marketplaces (PMPs) provide publishers with the ability to designate certain parts of their advertising inventory to a select buyer or group of buyers, which differs from the open auction where the advertising inventory is open to all bidders.

In the U.S., the market where programmatic got its start, private marketplaces have grown massively in popularity. PMP is projected to account for 28% of an $11.8 billion programmatic market by 2016 up from just 2.0% in 2013, according to eMarketer.

Here are three reasons why PMPs have become a favorite of so many buyers and premium publishers.

Control

PMPs allow publishers to determine the buyers or advertisers that will be allowed to bid on certain parts of their inventory. This control often means that publishers feel more comfortable about selling their premium inventory programmatically, since they have selected the advertisers that they are offering it to. It’s the type of control that buyers and publishers have always had during the traditional direct sales process and PMP can bring it to programmatic.

PMPs provide buyers with added inventory transparency as being part of a PMP means they will have already identified a publisher they are comfortable buying from. PMPs also provide buyers with access to some types of premium inventory that may not be available in open auction. Finally, PMPs provide premium publishers with an extra level of confidence about the creative that will appear on their digital properties, helping to address any concerns they have around brand safety.

Workflow Automation

PMPs offer the superior workflow automation that is the hallmark of programmatic advertising when compared with traditional direct sales. Both publishers and buyers benefit by significantly reducing the traditionally time-consuming process required to execute traditional direct sales.

Relationships

PMPs allow publishers and buyers to extend an existing direct relationship into programmatic. As more inventory is bought programmatically, PMP is an easy way for both buyers and sellers to maintain the rewards of an existing direct sales relationship whilst at the same time benefiting from the efficiency and effectiveness of programmatic execution.

Programmatic is exploding globally, estimated to reach 48% of all global digital display spending this year. As that growth continues, PMPs will play a significant role as buyers and publishers seek to take advantage of its benefits as we move further into the age of programmatic.

Click the hyperlinks to learn more about PubMatic’s PMP and programmatic direct offerings for publishers and buyers.

As publishers continue to look for efficiencies in their advertising sales strategy by opening up programmatic sales, one of the key challenges they face is finding a way to manage all revenue channels holistically. In just a few years, programmatic has grown from a relatively small portion of the inventory most publishers sell to become a significant part of their revenue picture. In 2015, globally, programmatic is expected to reach 48 percent of total display ad spend and by 2018 the U.S. figure is forecasted to reach 82 percent of all display ad spend according to Magna Global.

While many publishers have developed a sophisticated technology stack that helps them to package, offer and sell their inventory programmatically, they are in many cases still working to address the internal challenges that may impede their ability to manage sales holistically. While the fast changing ad sales market offers a host of change management issues for publishers here are three things every publisher should consider when they are evaluating how to navigate the complexity of multiple sales channels.

Sales Workflow

As publishers continue to grow their direct sales efforts as well as manage external programmatic partnerships, there are some workflow practices that need to be reconciled in order to most effectively manage all of the demand they see. This can include CRM, inventory management, ad trafficking and billing systems. It is not unusual – and often required – for publishers to use different systems and processes across their programmatic versus traditional direct sales efforts. However, in order to truly manage and optimize across all sales channels publishers will need to drive consistency in how they apply their workflow systems to programmatic sales and traditional direct sales. In the current state, platforms that support programmatic transaction offer a level of data transparency that allows for seamless alignment with the direct channel in order to help unify both efforts. The goal is to ensure that one side informs the other as comprehensively as possible.

For example, a publisher may license a third party CRM platform to maintain a database of information about its advertiser and media buyer partnerships. This data will help provide valuable insights for their lead generation efforts. At the same time, data on advertiser or media buyer relationships coming in via programmatic sales also represents a lead generation opportunity but such data is often not captured by the current CRM platform. Therefore, this publisher may want to consider how this programmatic data might be merged into the same CRM system that houses the data gathered from traditional direct sales.

Rate Card Management and Pricing

Rate card pricing models have been used for many decades to guide upfronts and direct sales, long before the advent of programmatic. Yet with many advertisers and agencies now purchasing ad inventory from the same publisher both programmatically and directly, these buyers have the advantage of using the intelligence derived from a publisher’s rate card as well as the price floors and other pricing queues found through the programmatic channel. There is an opportunity for publishers to leverage both sets of sales data about their packaging and pricing to fully understand their demand landscape and optimize their revenue strategy. For example, many savvy publishers will use bid price, bid “density” (the volume of buyers and bids) and the resulting auction close price to understand how buyers are valuing impressions on the basis of context, audience or other forms of targeting. This allows them to gain significant insights that allow for a more dynamic pricing strategy where the direct rate card pricing is informed by buying behavior across all channels.

Sales Team Compensation Plans and Commissions

One of the challenges many publishers face is managing the impact of channel conflict on their direct sales team’s efforts. As many ad sales executives rely on commissions from direct sales as a significant part of their compensation, the concept of “cannibalization” often comes up as a concern when the share of programmatic buying grows, especially when some of the same advertisers appear through indirect channels. Some publishers have started to address this by using the data transparency coming from programmatic platforms to understand which advertisers are running through multiple channels, and then building a compensation plan for their direct sales team that is tied to programmatic sales activity.

With many resources available to get over the challenges preventing truly holistic advertising sales, the biggest challenge is to manage the change process itself. The buying landscape is changing rapidly. However, the tools are there to allow publishers to make the most of their inventory assets, drive the greatest possible value to their available advertising real estate, and stay ahead of the shift in the market.

In the fourth and final installment of our ABCs of Programmatic Series – where we try to help demystify programmatic by defining some of its most frequently used buzzwords – we define terms from “R” through “Y” taking us from Real-Time Analytics through Yield Management.

Real-Time Analytics: Dynamic analysis and reporting that users can access in the moment that the original data is captured from campaign or inventory performance by the system. This allows publishers and buyers to make decisions with real-time insights as events happen.

Retargeting: A technique that uses information about a consumer’s web browsing habits to re-send an advertisement to them on a different publisher’s website. This is achieved through pixel tagging or other code that enables a publisher to recognize a particular user. Source: IAB, PubMatic

Rich Media: Advertisements that users can interact with in a web page format, often in conjunction with advanced technology such as streaming video, for example.

Spot Buying: Transactions that exist within an exchange environment with pre-negotiated, fixed pricing (CPM, CPC, etc.). Typically, these are given a higher priority than open marketplace or Private Marketplace transactions. These types of deals are the result of advertiser demand for a more predictable offering within the exchange space. Source: PubMatic 2015 Programmatic Outlook Report

Supply-Side Platform (SSP): A technology platform that provides a publisher with brand control, pricing and packaging tools and reporting capabilities in order to help them to manage their inventory assets in a programmatic advertising world; also known as a “sell-side platform.” Source: IAB

Third-Party Data: User data that is collected, repackaged, and processed by companies that track and analyze consumer characteristics or preferences. This information can be used for future ad targeting and digital marketing purposes. Source: IAB, PubMatic

VAST (Video Ad Serving Template): A standardized communication method that informs an ad server every time a video ad is played. This method is specifically designed for popular on-demand video players where ad responses are measured by each video play, but are not an executable ad format. Source: IAB, PubMatic

Viewability: An online advertising metric that aims to track only impressions that are seen by consumers. For example, if an ad is loaded below the fold of a web page and the user does not scroll to view it, the ad is deemed as not viewable.

Wearables: Electronic technologies or computers that are incorporated into items of clothing and accessories that can be worn comfortably on the body. Examples include the Apple Watch, FitBit heath tracking devices, Pebble watches, and Google Glass, among many others; also known as “wearable technology” or “wearable devices.” Source: PubMatic, WearableDevices.com

Whitelist: For Advertisers: A list of websites that an advertiser will permit their ads to be placed on. For Publishers: A list of the advertisers that a publisher will permit to have access to see and bid on their inventory.

Programmatic and mobile seem destined to be together. It’s difficult to name two other technological trends that have done more to disrupt the established order in advertising and media over the past three years. This year, 55 percent of all digital display ads in the U.S. will be bought programmatically up from just 24 percent in 2013, according to eMarketer. At the same time, U.S. Internet users now spend the majority of their time consuming digital media on a mobile device, according to comScore.

Earlier this year, we conducted a survey of PubMatic publishers and buyers asking a series of questions about mobile advertising. Even as it’s clear that mobile and programmatic are on an obvious collision course, we wanted to find out what was happening in the market from the perspective of its day-to-day participants.

We asked our customers to tell us what they felt were the specific factors spurring the growth of mobile programmatic. Here is what they had to say.

Top 3 Factors Spurring the Growth of Mobile Programmatic

The Growth of Private Marketplaces: 66 percent of customers indicated that the ability to transact mobile media in private marketplaces (PMPs) has helped foster the growth of mobile programmatic more than any other factor. Indeed, PMP provides buyers transparency about the publishers they are buying from programmatically and at the same time it allows publishers to continue to have a more direct relationship with their buyers than traditional open RTB. Therefore, it’s no wonder that PMP has been a preferred environment for buyers and sellers when it comes to an emerging platform, like mobile. PMP growth is not only limited to mobile. Indeed, eMarketer projects that PMP will account for 28 percent of programmatic spending by 2016, up from just 2 percent in 2013.

Use of New and Innovative Formats: 55 percent of customers also cited the growth of new and innovative formats as contributing significantly to the growth of mobile programmatic. These formats would no doubt include native ads, which is set to grow to $21 billion in U.S. ad spend by 2018 up from $4.7 billion in 2013, according to Business Insider. Many native ad units are designed to be in-feed or integrated as snippets of text and images that are especially seamless and effective when served within the context of a consumer’s mobile experience.

Surge In Advertiser Demand: Advertising spend inevitably chases consumers and mobile media doesn’t seem to be an exception to this well-established rule. As Mary Meeker pointed out last month, mobile is only 8 percent of ad spend, while consumer time spent on mobile is 24 percent. This equals a $25B opportunity as advertisers catch-up to the consumer. So it is no surprise that 80 percent of our survey respondents expect mobile ad spending to increase.

Mobile advertising needs to scale quickly and programmatic technology is designed to handle massive scale. With the help of PMP, the wide adoption of new mobile friendly formats and the need for ad spend to follow consumers, it looks like mobile programmatic has all of the key ingredients that will drive its growth for the foreseeable future.